Statement re H Corp Consents

RNS Number:5519Y
Sanctuary Housing Association
16 February 2006


Sanctuary Housing Association ("Sanctuary")

8.375 per cent. #110,000,000 First Mortgage Debenture Stock 2031 ("the Stock")

Sanctuary notes the announcement made on 14th February, 2006 to Parliament by
Housing Minister Yvette Cooper that The Government will legislate to modernise
the Housing Corporation's decision making arrangements as necessary, at the
earliest opportunity. This will clarify its ability to delegate decisions from
the Board to subcommittees and to officers. Sanctuary also notes the statement
made by the Office of the Deputy Prime Minister to lenders on 14th February,
2006 that in its view (having taken Counsel's opinion) security over assets is
secure at present. ODPM says it fully recognises the seriousness of the issue to
lenders and the Government has therefore agreed in principle to legislate and to
give retrospective effect to some historical consents given by officers of the
Housing Corporation at the earliest opportunity.

The two tranches of the Stock issued by Sanctuary on 22 November 1996 and 14 May
1998 are secured by legal charges granted by Sanctuary, which charges in turn
required s9 Housing Act 1996 consents to be valid. Accordingly, Sanctuary
welcomes the announcement that primary legislation will be brought forward to
deal with the issue that, absent such remedial action, there are (a) legal risks
relating to the authorisation by the Housing Corporation of the s9 consents and
(b) consequent uncertainty regarding the security for the Stock. Sanctuary has
also been informed that the Housing Corporation is taking legal advice on
retroactively granting s9 consents to regularise the situation.

Sanctuary will monitor developments in this regard and will make further 
announcements as appropriate.

Contact details for further information:

Craig Moule              Group Finance and Resources Director
                         Telephone [phone]

John Shinton             Royal Bank of Canada Europe Limited
                         Telephone [phone]



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